Exploring the Key Findings of Global Entrepreneurship Monitor in 2021
Global Entrepreneurship Monitor (GEM) is an international research consortium that studies entrepreneurship and related activities in over 100 countries. It collates data on new and developing businesses, analyzing the entrepreneurial ecosystem of each country, and identifying trends in entrepreneurship worldwide. Here we take a closer look at some crucial findings from GEM’s 2021 report.
The Pandemic and Entrepreneurship
According to the GEM 2021 report, COVID-19 posed significant challenges to entrepreneurs worldwide. The pandemic forced many entrepreneurs to rethink their business models, strategies, and operations resulting in asset reallocation and creative responses to new business needs. The report states that 61% of respondents who owned businesses felt the pandemic had affected their ventures, with 31% indicating a decline in sales or cash flow. Lockdowns and mobility restrictions were the most prevalent challenges, and survey respondents noted that pivoting to a digital-first approach mitigated many of the impacts.
Impact on Entrepreneurship Ecosystems
The pandemic affected the entrepreneurial ecosystems of different countries differently. The GEM report found that countries with better-developed entrepreneurial ecosystems were more resilient to the pandemic’s impacts. The report further identified the critical areas that either boosted or hindered entrepreneurship. These areas include the availability of venture capital, government regulation, innovation, market size, and workforce skills. The report calls for governments to improve the ecosystems by creating a conducive business environment by supporting entrepreneurial innovations and boosting education and training skills in their countries.
Shifts in Entrepreneurship Trends
The GEM report also found that entrepreneurship trends shifted significantly in response to COVID-19. For instance, the pandemic led to an increase in home-based businesses. There was also a significant shift to the digital economy, with businesses adopting new technologies to serve remote customers better. In addition, the report highlighted a surge in female entrepreneurship in countries with more developed ecosystems. Successful female entrepreneurs inspired more women to start businesses in 2021 as women looked to create businesses that can adapt to the new normal.
Conclusion
The GEM 2021 report highlights how the pandemic affected entrepreneurship, bringing to the forefront the resilience of entrepreneurs in adapting to the new normal. It also raises the importance of a conducive ecosystem for entrepreneurship and the need for governments to create supportive entrepreneurial environments. Entrepreneurs should continue to monitor the shifts in entrepreneurship trends and take advantage of the opportunities that the pandemic adapted to their businesses.
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